Raimondo shakes up tourism industry

Local districts may be cut
Fri, 03/20/2015 - 11:30am
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Block Island Tourism Council Executive Jessica Willi had been expecting a shakeup in how the state funds its tourism bureaus ever since Gov. Gina Raimondo was elected last November. Those expectations were met when Raimondo, a Democrat, presented her first state budget on March 12. While Willi said that she is "excited" that tourism is now being talked about at the state level, she has questions as to how the needs of that industry will be met.

Toward the end of her budget speech, Raimondo said this:

"We need more people to experience the things we all love. For too many years, though, we haven't maximized the effectiveness in our state-funded tourism efforts. Rather than spending the resources in one concentrated way to maximize the bang for our buck, we've been sprinkling state-funded tourism dollars among various tourism bureaus around the state.

"The time has come to redesign how we market our wonderful state to prospective visitors.

"My proposal will restructure our tourism marketing efforts by concentrating resources behind a unified statewide tourism message. I realize that this proposal will cause some initial concern among the local bureaus, and that it is a change from the way we've always done it, but let's work together over the coming months to find a solution. If we do this right, we can supercharge our tourism industry and create thousands of jobs just like other states have and that our families deserve."

The governor wants to increase funding for tourism and marketing through a variety of taxes and cuts. If the budget is approved, the cuts will be made to five of the six local tourism districts, including Block Island. New revenue will come from such sources as the cottage tax and additional tax monies from such new businesses such as airbnb — so that homes participating in that online service are taxed as hotels are. Currently, a portion of the six percent of the state hotel tax that was once collected to directly support state tourism has been going into the state general fund. In recent years, Rhode Island has been consistently ranked at the bottom in terms of how much it spends on tourism marketing and development.

By the state's own estimation, the new funding sources Raimondo has proposed will amount to about $6.5 million. But here is where the questions come in for Willi. While Raimondo suggested in her speech that the monies will go to tourism, they will actually be directed to RI Commerce (formerly the R.I. Economic Development Council), a state department, and could be used either for tourism or business marketing. It is the fuzziness of this language that has Willi concerned. This is better, she said, than "going into the black hole that is the state general fund," but it is still unclear as to how RI Commerce will allocate the new funds. "Now it will be given to RI Commerce, so it's not going to the state Tourism Office. So there is a little bit of concern there. The former EDC doesn't have the best track record," Willi said.

The specific budget for tourism and business marketing is $5.5 million. If the state is estimating that almost $6.5 million will be raised from the suite of taxes and cuts, where is the extra million going, Willi also asked. And if more money than is needed is being raised, why cut the local bureaus?

"There are still more questions than answers," said Willi.

At the local level, Block Island's funding will be cut from 47 percent to 25 percent of the six percent hotel tax, which would reduce local funding by about $120,000, said Willi. In anticipation that Raimondo's budget will be approved, Willi said that she has already ceased all non-essential spending.

"We're super excited that there is so much attention on tourism and with the governor acknowledging that tourism is important to the economy. That's a good thing. As my colleagues do, we fully support a restructured state tourism office and to promote a state brand," said Willi. Raimondo was the first gubernatorial campaign to put tourism into her campaign platform. "The caveat is that the current way the budget reads is confusing, even to those of us who have been doing this for many more years than I have."

Willi is also concerned that the collective expertise of the local bureau heads will be lost if their budgets are diminished, and even cut entirely, over time. "The regions have been doing this work for years and understand tourism. There's over 100 years of experience between the six people," she said. While she supports a more focused marketing campaign the state — one that would be similar to the successful "I love New York" and "Virginia is for lovers" campaigns, Willi also wondered what the impact will be on Block Island. Marketing Block Island takes a little finesse, promotion in the shoulder seasons and mid-week visits. Willi wondered if a centralized office will understand that. 

It's an interesting time for the tourism industry in Rhode Island, Willi said. Even with an underfunded and understaffed state office, "tourism is up and going up, but the state tourism office can't take the place of the regional offices. We're the boots on the ground." Tourism on Block Island was up 12 percent this past fiscal year, she said.

Right now, the budget is in the hands of the members of the General Assembly, and she hopes that state Sen. Susan Sosnowski (D-Dist. 37) and state Rep. Blake Filippi (I-Dist. 36) "will stand behind the industry, keep the formula as it is and keep the funds on Block Island." Willi said that cuts will have an immediate impact on the island. "When the town wants $5,000 or Blues On the Block wants $3,000 or the Chamber asks for $30,000 — all those things get cut." And because the budget is still not approved, the Block Island and the other regional offices can not plan for next year. "It's very confusing and frustrating," she said.

Willi said that she and the other district's heads hope to have an audience with the governor soon — they have not yet had a meeting — and work with the governor on improving the tourism industry in the state. "We want to work with the governor, there's no question about that," she said. But the regional tourism offices play a crucial role. "We want to see a fully funded state tourism office, and we know how to accomplish that. We can help," she said.